Even though you may have taken the first steps towards paying off your debt, it's important to ensure that if you were to die unexpectedly, your family would not be saddled with paying back the remainder of the money – potentially without an income to support them. Being the sole breadwinner of a family, or even contributing to the income of your household, comes with a large responsibility – you need to take out the right protection to ensure that if that income (or the proportion that you contributed) were to be taken away overnight, your family would still be able to manage. Therefore, if you have a family, and you have significant debts to pay off and no life insurance, you need to reevaluate the situation urgently.

If you have looked into debt management options already, you will probably already be aware of how much you owe in total. In most cases debt management plans are designed for paying off 'non-priority' debts such as unsecured loans, but for the purposes of taking out life insurance to pay off your debts, you would also have to factor in the amount that you owe on your mortgage and any secured loans that you have taken out. Therefore, start by calculating the total debt that would require paying off should the worst happen.

The next step is to look at the type of life insurance that you need. You can take out life insurance cover relatively cheaply (from as little as £5-10 per month if you fall into a lower-risk category). However, it's better not to look just at the price when you're considering life insurance, because it will be a false economy if you end up taking out the wrong cover simply because it is cheaper. Life insurance works by giving you a cash lump sum payout if you die within a set time period, which could be just a few years if you want your family to just be able to pay off specific debts or the rest of your life if you want your family to receive a payout regardless of when you die.

No life insurance policy is an 'off-the-peg' solution, and so it is best to speak to a life insurance adviser to work out the best type of life cover for your circumstances. Of course, if you are involved in a debt management plan or IVA already, the majority your disposable income is likely to be earmarked for monthly repayments for the duration of the term, so be sure to check how much you have available to put towards life cover before you arrange the consultation.